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6 Consumer Law

Consumer Protection
Laws in India
• Wide spectrum of Laws
• Constitution to CPA, 2019
• Constitutional Mandate
• Art 19(1)(g)- Freedom of profession, trade or business
• Art 19(2)- Reasonable restrictions
• Business on streets, harmful/dangerous trade
• Art 21- RTL also includes Right to health
• Vincent v UOI
• Art 47- State to raise the level of nutrition and standards of living
to improve public health
Wide Spectrum of Laws
• Prevention of Food Adulteration Act,
• Essential Commodities Act, 1955
• Prevention of Black marketing Act,
• Standards of Weights and Measures
Act, 1976
• Bureau of Indian Standard Act, 1986
• Sugar (Regulation of Production) Act,
• Drugs and Cosmetic Act, 1940
• Competition Act, 2002
• Electricity Act, 2003
• Intellectual Property Laws
• Consumer Protection Act, 1986
• Consumer Protection Act, 2019
Law of Torts
Donoghue v Stevenson [1932] UKHL 100
• Mrs. Donoghue's friend bought ginger beer from Cafe in Paisley
• Bottle opaque glass- She consumed half bottle
• Remaining pour into a glass
• She noticed decomposed snail floated out
• Severe gastro-enterities
• She sued Stevenson, a manufacturer
• Defendant contented
• No contractual agreement
Source: https://i.ytimg.com/vi/WgEYzgrNvy0/hqdefault.jpg
HOL held that
• It was a negligence
• Even no contractual arrangement with Stevenson
• He is still responsible for integrity of product
• Duty to care breached
• Not to sell opaque bottles of ginger-beer
• Held defendant liable and to pay damages to plaintiff
Doctor- Negligent Services?
State of Gujarat and Others v Laxmiben Jayantilal Sikligar
• Patient suffering from pain in swallowing
• Government hospital- Doctor performed surgery
• Result- permanent paralysis of larynx (voice box)
• Doctor contented- no intention to cause harm
• Court held guilty of negligence
Res ipsa loquitur
• General rule for Burden of proof
• In Civil cases- On part of plaintiff
• In Criminal Cases
• State (prosecution) to prove
• Tort of negligence
• The thing speaks for itself
• Plaintiff need not prove negligence on part of defendant
• Inference of negligence drawn from facts
Source: https://study.com/cimages/multimages/16/resipsa.png
Consumer Protection Act, 2019 (old 1986)
• Better protection to rights of consumers
• Based on Doctrine of Caveat emptor
• Let the buyer beware
• Fitness of product
• Bicycle for trekking but sold ordinary bicycle
• Seller will be responsible
• Goods of marketable quality
• Sale by sample
• Seller will be responsible
Who is a Consumer?
• Any person who
• Buys any goods for a consideration which has been paid or will be paid
• Hires or avails any service for a consideration which has been paid or
will be paid
• It includes offline or online transactions through electronic means or by
tele-shopping or direct selling or multi-level marketing
• Prevent unfair trade practices in e-commerce
• Not consumer
• A person who purchase goods for resale or any commercial purpose
• Obtain services under Contract of Service
• Means any allegation in writing made by complainant
• Unfair trade practices or restrictive trade practices
• Goods bought by him suffer from defects
• Services availed/hired suffer from deficiency
• Trader charged a price in excess
• Hazardous goods/services offered for sale
“Complainant" means
• A consumer (end-user)
• Any voluntary consumer association registered under the
Company Law
• The Central Government or any State Government,
• One or more consumers, where there are numerous
consumers having the same interest
• In case of death of a consumer, his legal heir or
Goods and Product Liability
• "Goods" means every kind of movable property and includes "food"
• "Product liability" means the responsibility of a product manufacturer
or product seller, of any product or service, to compensate for any
harm caused to a consumer by such defective product manufactured
or sold or by deficiency in services relating thereto
• Eg. Pressure cooker explodes due to manufacturing defect and harms
• Earlier act
• Only compensate for cooker's cost & for injury separate suit before the civil court
• Now it can be sued before consumer forum for injury as well
Rights of a Consumer
• Right to safety
• Right to be informed
• Right to choose
• Right to be heard
• Right to seek redressal
• Right to consumer education
Composition of Consumer Disputes Redressal
Composition of
Appointment of Compensation
(Dist Judge)
-Min 2 members
State Govt
Rs 1 crore
-Within 45 days
President (HC Judge) State Govt
Commission -Min 4 members
Rs 1 cr to Rs 10
-Within 30 days
President (SC Judge) Central Govt
Commission -Min 4 members
Above Rs 10 cr
Supreme Court
-Within 30 days
Procedure for Complaint
• Limitation- Within 2 years of cause of action (Sec 69)
• Jurisdiction
• Where seller has his business
• Incident happened
• Where complainant resides
• Video conferencing also possible (physical presence is not compulsory)
• Submit- 3 copies of complaint with supporting documents
• Name and address of complainant & opposite parties
• Date of purchase, amount paid, item of goods
• Receipts if any, relief sought
Powers and Functions of Redressal Agencies
• Powers of Civil Court
• Summons, examine witness, attendance
• Forum can order following reliefs
To remove the defect
To replace defected goods with new
To pay compensation for any loss
To discontinue unfair trade practices
Not to offer hazardous goods for sale
• Encourages settlement by Mediation
Central Consumer Protection Authority
• Misleading ad, unfair trade practices
• False information regarding quality/quantity of good/service
• Fill the void in existing regulatory regime
• Consists of Chief Commissioner & other commissioners
• HQ- New Delhi
• Investigation wing, headed by DG
• To carry out inquiries and investigations, search and seizure
Functions and Powers of CCPA
Inquire violations of consumer rights
Issuance of safety notices
Impose penalty for violation
Adopt best international practices on consumer rights
Initiate suo motu actions
• Penalty for False/misleading ad
• 10 lakh & Rs 50 lakh for subsequent violation
• It can be imposed on endorsers as well
• Ban the endorser for 3 years
• Appeals from CCPA- to National Commission within 30 days
• Fails to comply with direction of CCPA
• Imprisonment 6 months or fine 20 lakh or both
• Penalty for adulterated products
• For injury- fine 3 lakh or imprisonment 1 year
• For death- fine 10 lakh or imprisonment 7 years
Source: https://img.etimg.com/photo/msid-70711442/consumer-protection-act.jpg
Limitations of CPA
• No interim relief- injunction
• Hospital (Shantha case)
• Free treatment (contract of service)- CPA doesn’t
• Because no master-servant relationship
• Private Hospital (contract for service)- CPA applies